Do municipal mergers reduce costs? Evidence from a German federal state

Arbeitspapier

We study the fiscal consequences of municipal mergers by making use of a largescale merger reform in the German federal state of Brandenburg. In addition to being the first evaluation of an East-German merger reform, this study contributes to the literature by exploring the fiscal consequences of both compulsory and (semi-) voluntary municipal mergers within the same institutional setting. Using a difference-in-difference design with municipality-level panel data over 1998-2005, we find substantial and immediate reductions in total, administrative, and current expenditures after compulsory mergers. Voluntary mergers, on the other hand, have smaller and less robust effects.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: cege Discussion Papers ; No. 176 [rev.]

Classification and Topics

• Classification: Wirtschaft ; Structure, Scope, and Performance of Government ; State and Local Budget and Expenditures ; Intergovernmental Relations; Federalism; Secession ; Public Facility Location Analysis; Public Investment and Capital Stock
• Subject: municipal mergers ; economies of scale ; voluntary and compulsory mergers

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Blesse, Sebastian ; Baskaran, Thushyanthan
• Event: Veröffentlichung
• (who): University of Göttingen, Center for European, Governance and Economic Development Research (cege)
• (where): Göttingen
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/103878
• Last update: 10.03.2025, 11:45 AM CET